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Potential audits
Portfolio
‘Tell us once’ – Sharing of Customer Information
In December 2009, the then Minister for Human Services announced major reforms to Australian Government service delivery. This included a ‘tell us once’ policy aimed at eliminating the need for customers to give the same information to different agencies within the Human Services portfolio.
One example of this arrangement is the process to align the rules used for determining care levels for separated parents who are both child support and family assistance customers. Previously, the Family Assistance Office and the CSA applied different rules to determine the level of care used to calculate family assistance and child support payments. The alignment of care measure allows a single determination of care, using one set of rules, to be made for both family assistance and child support purposes. This allows families receiving child support and family assistance to have their level of care assessed through one agency, either the Family Assistance Office or the CSA.
An audit, or a series of audits, would examine the effectiveness of the information sharing arrangements within the Human Services portfolio.
Use of Coercive Information-Gathering Powers
Coercive information-gathering powers are important administrative and regulatory devices used by many Australian Government agencies. These powers can be used to compel the provision of information, the production of documents and the answering of questions. An overriding principle for the use of such powers is that the exercise of the power is closely controlled, so as to achieve a balance between obtaining the necessary information and safeguarding the rights and freedoms of the individuals or organisations affected.
In 2008, the Administrative Review Council published a report—The Coercive Information-gathering Powers of Government Agencies—that outlined 20 best-practice principles it considered, if followed, would ensure that agencies use coercive
information-gathering powers effectively, efficiently and with due regard to individual rights. Within the Department of Human Services (DHS), coercive information-gathering powers are used across a variety of functions including Centrelink, Medicare and the CSA.
An audit would examine the use of coercive information-gathering powers within the Department of Human Services.
Administration of Payments Made Under the Scheme for Compensation for Detriment Caused by Defective Administration
The Scheme for Compensation for Detriment caused by Defective Administration(CDDA Scheme) is an administrative scheme which provides Australian Government agencies with the discretion to make compensation payments where there is a moral rather than a legal obligation. The CDDA Scheme enables agencies to compensate persons who have experienced detriment as a result of the agency’s defective actions or inaction.
In 2009–10, the Human Services portfolio made 1146 payments totalling $3.4 million under the CDDA Scheme. Centrelink made the majority of the payments (1089 payments costing $3.2 million). In August 2009, the Ombudsman published a report—Putting things right: compensating for defective administration—which reported findings on an investigation of the CDDA Scheme. In the report the policies and practices of Centrelink, the CSA and the Australian Taxation Office were used to illustrate emerging and recurring issues.
ANAO Audit Report No. 35, 2003–04, Compensation Payment and Debt Relief in Special Circumstances, also examined the CDDA Scheme as part of a cross-agency audit of a number of the discretionary compensation and debt relief mechanisms that are available to the Australian Government. The report concluded that there was insufficient monitoring of act of grace, CDDA and waiver claims by agency management and considered that agencies should put in place appropriate performance indicators, and report against them on a regular basis. The ANAO made eleven recommendations, seven of which were for agencies receiving claims for compensation and debt relief.
An audit, or series of audits, would examine the administration of CDDA Scheme payments made within the Human Services portfolio.
Property Management
In 2009–10, the Department of Human Services (excluding CRS Australia) maintained a lease portfolio of over 900 sites, including customer service centres, call centres, and national and area support offices, which occupied more than 750 000m2. Office lease and associated costs exceeded $350 million, with related capital expenditure of $106 million. In managing the property portfolio, important considerations include providing accommodation that is well located, is within easy reach for customers, and offers an appropriate environment for the delivery of services.
Following an open market tender process, a new property services contract for the Department of Human Services (with Centrelink as the lead agency) was signed with Jones Lang LaSalle and commenced in July 2010.
An audit would examine the effectiveness of the Department of Human Services’ property management arrangements, including its compliance with the Commonwealth Property Management Framework.
Centrelink
Income Management
The Welfare Payments Reform program, announced in July 2007 as part of the Northern Territory Emergency Response, included income management as one of five program measures. A new model of income management was introduced on 1 July 2010. The new model is targeted at specific categories of people receiving social security payments who the Australian Government considers to be among the most disengaged and disadvantaged individuals in the welfare system.
Income management directs between 50 to 70 per cent of certain income support and family payments, and 100 per cent of all lump sum payments, to essential expenses such as food, clothing, housing and utilities. One way that customers can access their income managed funds is through the BasicsCard. The BasicsCard is a PIN-protected card which allows customers to access their income managed money through EFTPOS facilities at approved stores and businesses.
ANAO Audit Report No. 26, 2010–11, Management of the Tender Process for a Replacement BasicsCard assessed the effectiveness of the Department of Human Services’ management of the tender process for a replacement BasicsCard. An audit, or series of audits, would look at further aspects of the implementation and ongoing operation of income management.
Customer Service Strategies
Centrelink has developed a range of strategies to deliver services to particular customer groups, including customers from diverse cultural and linguistic backgrounds and Indigenous Australians. Around 20 per cent of Centrelink’s customers are from diverse cultural and linguistic backgrounds, and about 10 per cent need interpreting assistance when accessing services. Centrelink has developed strategies to deliver services to these customers such as language services and a network of 70 Multicultural Service Officers.
With regard to Indigenous Australians, Centrelink has developed an Indigenous Servicing Strategy and a Reconciliation Action Plan, both of which are being redeveloped. Centrelink also has a range of services and specialised officers aimed at supporting Indigenous customers. Some of these include Indigenous Service Units which assist Centrelink and other agencies to work with Indigenous people, a network of 80 Indigenous Service Officers that act as contact points between Indigenous communities, and Indigenous Call, which provides services to rural and remote Indigenous customers through a national phone number.
A series of audits would examine the effectiveness of Centrelink’s service strategies for particular customer groups. This could include examining the services available to multicultural customers from diverse cultural and linguistic backgrounds and Indigenous Australians.
Fraud Identification and Investigation for Disaster Payments
Centrelink is responsible for delivering financial assistance, such as the Australian Government Disaster Recovery Payment (AGDRP) and ex gratia payments, to eligible recipients immediately following the occurrence of a disaster. Between November 2010 and February 2011, the Australian Government authorised payments for people affected by severe weather events occurring in multiple regions in Australia. As at July 2011, some $880 million in AGDRP had been paid to more than 700 000 disaster claimants.
In January 2011, the Minister for Human Services announced in that Centrelink had set up a dedicated task force to investigate fraudulent flood claims. As at 4 July 2011, the taskforce had identified 10 709 payments for examination, of which 7519 had been finalised resulting in debts raised of $4.7 million.
ANAO Audit Report No. 36 2009–10, Emergency Management and Community Recovery Assistance in Centrelink, identified gaps in Centrelink’s payment integrity activities which limit the level of assurance that Centrelink can provide on the validity of disaster recovery payments. An audit would examine Centrelink’s procedures for identifying risks to payment integrity and its processes for identifying and investigating potential disaster payment fraud.
Case Management
Centrelink interacts with over seven million customers in a variety of situations. Certain customers require a more structured approach to meet their needs and, in these circumstances, Centrelink can adopt a ‘case management’ approach. Case management is a more focused approach to addressing a customer’s individual circumstances in order to achieve the desired outcomes and can be used in a wide variety of situations, such as for customers living in extraordinary circumstances due to a natural disaster.
An audit would examine Centrelink’s approach to case management and its effectiveness in achieving the desired outcomes for both the customer and the Australian Government.
Child Support Agency
Customer Feedback (including complaints) and the System of Review and Appeal
Actively seeking feedback (including complaints) is part of the CSA’s ‘Customer Service Commitment’. Further, having in place an appropriate review and appeals system that is accessible to parents who disagree with a decision is a fundamental part of the Child Support Scheme.
The CSA makes feedback channels available to parents and also has in place an internal review and appeal system. Stage 2 of the Child Support Scheme Reforms included changes to the review and appeal mechanisms available to parents. Previously, parents who were unhappy with a CSA decision could only appeal to the courts. In 2007, the role of the Social Security Appeals Tribunal was expanded to include reviews of CSA decisions.
The ANAO is currently undertaking an audit examining the CSA’s customer feedback system. Future audits in this area could also include internal and external review and appeal mechanisms.
Management of International Debt
Total child support debt refers to the amount of unpaid child support that has accumulated since the Child Support Scheme began in 1988. International debt is the component of total child support debt that relates to money owed to, or by, parents residing overseas, and any domestic debt associated with these customers. In 2009–10, total child support debt was $1.2 billion, of which international debt accounted for approximately 26 per cent. International debt increased by 14 per cent from 2008–09 and has been growing at a faster rate than domestic debt.
As part of managing international debt, the CSA has in place reciprocal agreements with over 90 countries. In recent years, the CSA has implemented a number of measures designed to improve its management of international debt, including increased online access for international customers, new procedural instructions and revised business processes.
An audit would examine the CSA’a effectiveness in managing and collecting international debts.
Change of Assessment Process
CSA customers (payer or payee) can apply for a change of assessment review if they believe the current determination of child support payable does not reflect their own, their child’s, or the other parent’s true financial circumstances. Change of assessment applications have been rising in recent years and, in 2009–10, the CSA received 20 151 applications. Of the 15 923 applications that were accepted (that is not withdrawn, incomplete or ineligible), 77.6 per cent resulted in a variation to the child support assessment. In 2009–10, the CSA trialled a redesigned change of assessment process and intends to implement the new process in 2010–11.
An audit would examine the CSA’s management of the change of assessment process.
Administration of Departure Prohibition Orders
Since 2001, through the use of a Departure Prohibition Order (DPO), the CSA has the legislative power to make administrative orders preventing a person with an overdue child support debt from leaving Australia. A DPO places significant restrictions on the freedom of movement of citizens and residents of Australia and visitors to Australia. As such, the CSA cites the use of DPOs as a last resort, with their issuance only occurring after an in-depth consideration of all the relevant information about a person’s situation.
Since 2007–08, the CSA has issued over 1500 DPOs and reports collecting or correcting over $14 million in child support payments. An audit would examine the CSA’s administration and use of DPOs as a compliance and enforcement activity.
Medicare Australia
Administration of the Chronic Disease Dental Scheme
The Chronic Disease Dental Scheme was introduced in November 2007. The Scheme allows chronically ill people, who are being managed under an Enhanced Primary Care Plan, access to Medicare rebates for most dental services. The Scheme entitles eligible patients subsidies of up to $4250. In June 2010, a taskforce was established within Medicare Australia to investigate the level of compliance with the Scheme. At the same time, Medicare Australia commenced a program to educate and inform dentists on the use of the Scheme.
At the time it was established, the Scheme was forecast to cost $385 million over four years. However, in 2009 alone, more than $484 million was claimed under the Scheme.
An audit would examine the effectiveness of Medicare Australia’s administration of the Scheme, including compliance activities.
Small Business Superannuation Clearing House
The Small Business Superannuation Clearing House facility, administered by Medicare Australia, commenced on 1 July 2010. The facility is designed to reduce the cost of complying with superannuation guarantee obligations for small businesses with fewer than 20 employees. Eligible employers wanting to use the service are required to register with Medicare Australia. This process includes providing the details of their employees’ superannuation funds, together with each employee’s superannuation contribution amount. The facility is designed to receive the employer’s superannuation contribution amounts and distribute the contribution amounts among the elected superannuation funds.
Medicare Australia has received $16.1 million over three years to operate the facility.
An audit would examine Medicare Australia’s implementation and administration of the Small Business Superannuation Clearing House.
National Compliance Program
Medicare Australia publishes, on an annual basis, a National Compliance Program that sets out to inform both providers and the public about Medicare Australia’s approach to compliance activities. In addition to outlining the compliance model and approach, the National Compliance Program 2010–11, includes key focus areas and priorities across service areas such as general practitioners, specialists, pharmacists and aged care providers.
Medicare Australia uses a range of tools as part of its compliance management. These include audits and reviews, data matching, artificial intelligence analysis and tip-offs from members of the community or the professions. In 2009–10, Medicare Australia initiated action to recover $10.3 million in debts from over 600 individuals.
A series of audits would examine the effectiveness of Medicare Australia’s compliance framework and activities.
The Australian Organ Donor Register
The Australian Organ Donor Register provides a service for people wishing to consent or object to becoming organ or tissue donors. People register their consent or objection through a website, or through completing forms provided by Medicare Australia. The register is administered by Medicare Australia and, in the event of someone’s death, can be accessed by authorised personnel at anytime, anywhere in Australia, to identify the deceased’s organ donor status. In 2009–10, almost 1.4 million people had registered their consent to organ or tissue donation.
An audit would examine the effectiveness of Medicare Australia’s administration of the register.
Compensation Recovery Program
The Compensation Recovery program aims to prevent ‘double dipping’ in medical benefits, nursing home benefits and residential care subsidies paid by the Australian Government where a person receives compensation in excess of $5000 (including costs) for an injury or illness by way of judgement or settlement. Medicare Australia administers the program on behalf of the Department of Health and Ageing and in 2009–10, 47 876 cases were finalised with $37.9 million being recovered. This was a 6.3 per cent increase in the number of cases finalised, and a 14.2 per cent increase in the value of benefits recovered from 2008–09.
An audit would examine Medicare Australia’s administration of the Compensation Recovery program.